KARACHI: The State Bank of Pakistan (SBP) has introduced a new policy that allows exchange companies to conduct short-term forward sale transactions tied to home remittance receipts.
Exchange companies can now enter forward sale agreements with authorised banks in the country for periods of up to five working days after receiving inflows.
The framework enables firms to lock in exchange rates in advance, reducing their exposure to sudden currency fluctuations in the market.
In simple terms, companies can agree to sell dollars at a fixed price on a future date, protecting the value of funds received from abroad.
The move is aimed at stabilising external inflows at a time when remittances remain a critical source of foreign exchange for Pakistan.
Exchange companies facilitated around five billion dollars in inflows during the last fiscal year, according to recently published industry figures.
Total worker remittances for fiscal year 2024–25 reached approximately thirty-eight billion dollars, underlining the sector’s significance to Pakistan’s economy.
Zafar Paracha, president of the Exchange Companies Association of Pakistan, welcomed the policy and praised the central bank’s engagement with industry stakeholders.
He said the new mechanism would help improve regulatory compliance and strengthen liquidity management across exchange companies operating in Pakistan.
Paracha added that the measure is expected to encourage higher remittance flows through official banking channels rather than informal or unregulated routes.
Traders operating in the sector also expect the new forward sales facility to provide greater operational flexibility for exchange companies going forward.
